Alibaba heads for New York
The listing of China’s e-commerce giant Alibaba is expected to be one of America's biggest.
China's e-commerce giant Alibaba has opted for an initial public offering (IPO) in the US, rather than Hong Kong. It's expected to raise over $15bn, matching Facebook's flotation in 2012, making it one of America's biggest IPOs on record.
What the commentators said
Its biggest website is Taobao, a "gigantic Chinese bazaar" with 760 million product listings. With Tmall, another shopping site, Taobao accounted for more than half of all parcel deliveries in China in 2012. The two units' transaction volumes eclipsed Amazon's and eBay's combined that year. Alibaba is also "a huge player in China's creaky financial system", said Osawa.
Alipay, its PayPal equivalent, launched a money market fund that became one of the world's largest in eight months. It now has more investors than China's equity markets.
Given all this, Alibaba is quite a catch. So why did it opt to go to New York rather than Hong Kong? Partly because, as Matt Kranz noted in USA Today, Asian markets have lagged the US bull market and this is the busiest year for IPOs since 2007.
Moreover, unlike Hong Kong, New York permits a dual-class voting structure for listed firms, whereby founders can sell shares but remain in control. Dominated by financial and property firms, Hong Kong is looking more and more "one-dimensional" and "unappetising", said Aaron Back in The Wall Street Journal.